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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG)

JOSH A. KREVITT (CA SBN 208552) jkrevitt@gibsondunn.com H. MARK LYON (CA SBN 162061) mlyon@gibsondunn.com GIBSON, DUNN & CRUTCHER LLP 1881 Page Mill Road Palo Alto, CA 94304-1211 Telephone: (650) 849-5300 Facsimile: (650) 849-5333

MICHAEL A. JACOBS (CA SBN 111664) mjacobs@mofo.com RICHARD S.J. HUNG (CA SBN 197425) rhung@mofo.com HAROLD J. MCELHINNY (CA SBN 66781) hmcelhinny@mofo.com MORRISON & FOERSTER LLP 425 Market Street San Francisco, California 94105-2482 Telephone: (415) 268-7000 Facsimile: (415) 268-7522

Attorneys for Plaintiff and Counterclaim-Defendant Apple Inc.

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

APPLE INC., a California corporation, Plaintiff,

v. SAMSUNG ELECTRONICS CO., LTD., a Korean corporation; SAMSUNG ELECTRONICS AMERICA, INC., a New York corporation; and SAMSUNG TELECOMMUNICATIONS AMERICA, LLC, a Delaware limited liability company,

Defendants.

CASE NO. 12-cv-00630-LHK (PSG) APPLE INC.’S REPLY IN SUPPORT OF ITS MOTION FOR LEAVE TO AMEND ITS DISCLOSURE OF ASSERTED CLAIMS & INFRINGEMENT CONTENTIONS HEARING: Date: November 6, 2012 Time: 10:00 a.m. Place: Courtroom 5 Judge: Honorable Paul S. Grewal

SAMSUNG ELECTRONICS CO., LTD., a Korean corporation; SAMSUNG ELECTRONICS AMERICA, INC., a New York corporation, and SAMSUNG TELECOMMUNICATIONS AMERICA, LLC, a Delaware limited liability company,

Counterclaim-Plaintiffs, v.

APPLE INC., a California corporation,

Counterclaim-Defendant.

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) i

TABLE OF CONTENTS

Page

I. INTRODUCTION .................................................................................................................... 1

II. ARGUMENT ............................................................................................................................ 3

A. There Is Good Cause To Permit The Amendments At Issue ........................................ 3

1. Apple Promptly Proposed The Addition Of Jelly Bean And Does Not Seek Blanket Permission To Include All Future Jelly Bean Devices ..................................................................................................... 3

2. Apple Was Diligent In Initially Investigating All Claims At Issue In The Missing Claim Charts For The ’604 Patent And Samsung Has Suffered No Prejudice ................................................................ 5

3. Apple Was Diligent In Initially Investigating All Claims At Issue In The ’502 Claim Charts And Apple’s Proposed Amendments Do Not Expand The Scope Of Its Infringement Theories ............................................................................................................. 7

B. Even If This Court Concludes That Apple Did Not Act With Requisite Diligence (Which It Should Not), That Does Not End The Good Cause Inquiry ...................................................................................................... 8

III. CONCLUSION ......................................................................................................................... 9

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) ii

TABLE OF AUTHORITIES Page(s)

Cases

Acer Inc. v. Tech. Props., Ltd., 2010 WL 3618687 (N.D. Cal. 2010) ............................................................................................ 8

Atmel Corp. v. Info. Storage Devices, Inc., 1998 U.S. Dist. LEXIS 17564 (N.D. Cal. November 4, 1998) .................................................... 7

Bd. of Trs. of the Leland Stanford Junior Univ. v. Roche Molecular Sys., Inc., 2008 U.S. Dist. LEXIS 16556 (N.D. Cal. Mar. 4, 2008) ............................................................. 8

CBS Interactive, Inc. v. Etilize, Inc., 257 F.R.D. 195 (N.D. Cal. 2009) ................................................................................................. 8

Orion IP, LLC v. Staples, Inc., et al., 407 F. Supp.2d 815 (E.D. Tex. 2006) .......................................................................................... 7

Yodlee, Inc. v. CashEdge, Inc., 2007 U.S. Dist. LEXIS 39564 (N.D. Cal. May 17, 2007) ............................................................ 9

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) 1

I. INTRODUCTION

Through its Opposition, Samsung seeks to preclude Apple from amending its Disclosure of

Asserted Claims & Infringement Contentions (“Infringement Contentions”) to the same extent as is

sought by Samsung in its motion to amend Samsung’s contentions. Samsung seeks this one-sided

result even though it cannot dispute the following facts: Apple’s amendments do not introduce any

additional claims to the ones originally asserted, do not add any substantive changes to the theories of

infringement in the original assertions, nor do they appear to require Samsung to supplement or alter

its theories of invalidity.

With these facts conceded, it is not surprising that Samsung also has not meaningfully

articulated how it is prejudiced by the amendments at issue. Indeed, Samsung’s entire Opposition

includes only the following statement regarding the alleged prejudice: “Samsung will also suffer

prejudice if Apple is allowed to expand its contentions to assert these five additional claims against

17 products. For example, Samsung timely served its invalidity contentions on August 10, 2012.”

(Samsung’s Opp’n to Apple Inc.’s Mot. For Leave to Amend its Infringement Contentions (“Opp’n”)

at 7 (Dkt. 285).) Notably, although Samsung states that it already has served invalidity contentions

(as, of course, has Apple), it does not allege that its invalidity theories would have been different,

much less how they would have been different, had these amendments been made at an earlier time.

Moreover, Samsung does not contend that this case is at such an advanced stage that an alteration of a

party’s contentions now would be unduly difficult or unfair – nor can it. Samsung simultaneously

seeks leave of this Court to supplement its own infringement contentions to add a new Apple

operating system and device; despite its efforts to the contrary, Samsung cannot change the fact that

the parties are similarly situated in the relief that they seek, and the outcome of their respective

motions should be the same.

Notwithstanding the foregoing, Samsung opposes three of Apple’s proposed amendments:

(1) the inclusion of the Jelly Bean operating system, (2) the addition of three mistakenly omitted

claim charts for United States Patent No. 8,086,604 (“the ’604 patent”), and (3) the addition of five

previously asserted claims against already-accused Samsung devices for United States Patent No.

5,666,502 (“the ’502 patent”). As to the remaining amendments, the parties have agreed that Apple

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) 2

has good cause to amend because Apple was diligent and there is no prejudice to Samsung as to these

amendments.

Samsung’s opposition to the inclusion of the Jelly Bean operating system is premised on the

misunderstanding that Apple seeks to automatically include all future products that are capable of

running the Jelly Bean operating system. To be clear, Apple does not seek such an expansive

amendment to its Infringement Contentions; rather, Apple seeks only to include the Jelly Bean

operating system that has recently been made available for the various versions of the Samsung

Galaxy Nexus. Thus, Samsung’s purported concerns about Apple’s attempt to gain “blanket

permission to sweep into this case any product that uses ‘Jelly Bean’” are simply unfounded.

With respect to the three claim charts for the ’604 patent, Samsung does not deny that it was

aware of Apple’s service error in June 2012, but nevertheless claims that Apple did not act with

diligence in discovering the omission. The service error does not change the fact that Apple was

diligent in investigating its claims against the three devices at issue, in putting Samsung on notice of

Apple’s intention to accuse those devices of infringing the particularly asserted claims of the ’604

patent, and in seeking to correct the mistake as soon as it was identified. Given that the three charts

at issue neither add any new infringement theories, nor introduce any new claims into the case,

Samsung should not benefit from its deliberate decision to hide behind the error.

Finally, as to Apple’s proposed amendment to add stylus-based claims to already-accused

Samsung devices, Samsung does not dispute that Apple originally asserted these five claims and that

the amended contentions are entirely consistent with Apple’s original contentions. In other words,

the amendments at issue introduce no new infringement theory, and, hence, Samsung can claim no

prejudice.

In short, because Apple has acted with the requisite diligence as to each of the opposed

amendments either by investigating its infringement claims and/or by putting Samsung on notice of

its contentions, and because Samsung has failed to articulate what prejudice it might suffer as a result

of the proposed amendments, Apple’s Motion should be granted in its entirety. And if Apple is not

permitted to amend, then, by the same standard, Samsung should not be permitted to either. (See

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) 3

Opp’n at 10; also see Apple Inc.’s Resp. to Samsung’s Mot. to Supplement its Infringement

Contentions at 2 (Dkt. 279).)

II. ARGUMENT

A. There Is Good Cause To Permit The Amendments At Issue

1. Apple Promptly Proposed The Addition Of Jelly Bean And Does Not Seek

Blanket Permission To Include All Future Jelly Bean Devices

Samsung primarily opposes the inclusion of the Jelly Bean operating system by making the

unsupported allegation that Apple “appears to be requesting blanket permission to sweep into this

case any product that uses ‘Jelly Bean,’ now or in the future.” (Opp’n at 3.) This is a misstatement

of Apple’s position. Apple seeks permission only to amend its Infringement Contentions with respect

to devices that currently operate on the Jelly Bean operating system – i.e., the Samsung Galaxy

Nexus (unlocked and for all carrier-specific networks). Should Apple’s continuing investigation

reveal that the Jelly Bean or some subsequent operating system becomes available for additional

devices, Apple concedes that a further Order of this Court would be required before those product

and software combinations can be included as part of this case, just as Samsung must seek leave to

add any new Apple device that may operate on an existing operating system. Indeed, given that the

claim construction process has started, Apple believes that any further amendments by either party

would likely be untimely in the context of the overall case schedule.

In fact, Apple’s intent to include only already-released products in its amended Infringement

Contentions confirms that Apple acted with the requisite diligence in waiting until October 2012 to

supplement its Infringement Contentions as to Galaxy Nexus devices running the Jelly Bean

operating system. In its Opposition, Samsung makes much of the fact that the Jelly Bean operating

system was released beginning in July 2012. (Opp’n at 9.) But what Samsung fails to mention is that

in July 2012, Samsung released the Jelly Bean operating system only for the unlocked version of the

Galaxy Nexus; it did not release the operating system for the same device on the Sprint or Verizon

wireless networks until much later. (Declaration of Jason Lo (“Lo Decl.”), ¶ 2, Exh. A.)

Throughout the summer of 2012, the press was rampant with rumors that the Jelly Bean

release would be completed imminently for Sprint and Verizon carrier devices. (Lo Decl., ¶ 3, Exh.

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) 4

B; ¶ 4, Exh. C.) In the interest of judicial efficiency, Apple sought to supplement its Infringement

Contentions with respect to the Galaxy Nexus when the rollout was complete – so it could confirm no

functional differences between carriers – not as the operating system became available for each

individual carrier network.

Ultimately, Samsung did not roll out the Jelly Bean release to the Sprint versions of the

Galaxy Nexus until September 6, 2012. (Lo Decl., ¶ 5, Exh. D.) And the Verizon rollout did not

occur until even later, on September 21, 2012. (Lo Decl., ¶ 6, Exh. E.) After the rollout on the

Galaxy Nexus was complete, Apple completed its investigation and sought leave to amend its

Infringement Contentions for all Jelly Bean-based versions of the Galaxy Nexus two weeks later, on

October 5, 2012. Given the short time frame between the completion of the rollout and Apple’s

Motion, there is no support for Samsung’s contention that Apple failed to act with requisite diligence.

Not only was Apple diligent in seeking to amend its Infringement Contentions a mere two

weeks after the Jelly Bean rollout was complete, but the amendment at issue would inflict no

prejudice to Samsung. As noted above, Samsung has not articulated how the inclusion of the Jelly

Bean operating system would require it to alter its invalidity positions. Nor has Samsung articulated

why the inclusion of the Jelly Bean operating system would expand the scope of this case.

Indeed, even without Apple’s amendment, this Court and the ultimate fact-finder would be

required to consider the Jelly Bean operating system because Samsung itself has injected that

operating system into this case. In its response to Apple’s Interrogatory No. 29, Samsung has alleged

that Jelly Bean is a non-infringing alternative to the accused products. (Samsung’s Obj. and Resp. to

Apple’s Third Set of Interrogatories 39:23-24 (“any Samsung Galaxy Nexus using the Jelly Bean

version of the Android operating system uses non-infringing, alternative technology”).) With this

assertion, Samsung itself will be asking the fact-finder in this case to decide whether Jelly Bean

infringes the patents in suit. Because the Jelly Bean operating system already is a part of this case,

judicial economy counsels in favor of permitting Apple leave to amend so that its Infringement

Contentions are consistent with issues that necessarily will be litigated.1

1 There is no basis for Samsung to suggest that the parties must amend their infringement contentions each time

incremental “versions or builds” to an operating system are available. (Opp’n at 9.) Samsung itself has not sought leave to amend its infringement contentions each time Apple updates iOS, for example, from iOS 5.0 to iOS 5.0.1.

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) 5

2. Apple Was Diligent In Initially Investigating All Claims At Issue In The

Missing Claim Charts For The ’604 Patent And Samsung Has Suffered No

Prejudice

Due to an inadvertent error in file conversion that occurred during the service of over 8,000

pages on July 15, 2012, Apple mistakenly omitted three claim charts (totaling 152 pages) for the ’604

patent for three devices from its contentions. (Decl. of Emily Fedman in Supp. of Apple Inc.’s Mot.

for Leave to Amend its Infringement Contentions, ¶¶ 3, 10, and 37 (Dkt. 269-1).)

As a preliminary matter, Samsung does not and cannot claim that it suffered any prejudice as

a result of this mistake. After all, Samsung must have been aware of the oversight for months

because its attorneys reviewed the claim charts bearing the incorrect file names. Specifically,

Samsung would have noticed that the Apple Infringement Contentions contained three files bearing

the following names:

• Ex. 69 – ’604 Infringement Contentions--Conquer 4G--FINAL.pdf

• Ex. 70 – ’604 Infringement Contentions--Dart--FINAL.pdf

• Ex. 71 – ’604 Infringement Contentions--Exhibit II 4G--FINAL.pdf

Although the file names suggest that the documents at issue related to the Conquer 4G, Dart and

Exhibit II 4G devices, upon opening those files, Samsung’s counsel must have noticed that the

contents of the files had nothing to do with those devices; instead, those files were duplicates of claim

charts already provided for the Admire, Galaxy S II Skyrocket, and Galaxy S II devices. Given the

size of the contentions, and despite Apple’s post-service check of the contentions and identification

of certain other errors that it immediately corrected (Opp’n at 8), Apple did not discover these errors

until recently.

Moreover, Samsung already was on notice that Apple intended to accuse the Conquer 4G,

Dart and Exhibit II 4G devices of infringing the ’604 patent. This is because Exhibit 139 to Apple’s

Infringement Contentions, which summarized the patents, claims, and products at issue (“Claims

Apple has been diligently pursuing discovery from Google, Inc., which is represented by the same counsel as Samsung. To the extent that additional discovery reveals that any version or portion of Jelly Bean infringes Apple’s patents in materially different ways than previous operating systems, Apple will seek leave to supplement at the appropriate time if additional supplementation is permissible at that time.

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) 6

Summary Table”) identified to Samsung that Apple asserted that these three devices infringed the

’604 patent. For example, the Claims Summary Table disclosed that claims 1, 6, 11, and 16-21 were

infringed by the Samsung Conquer 4G.

Despite being aware of these discrepancies, Samsung did not alert Apple of the fact that no charts

were provided for those claims and products until October 2, 2012.

And perhaps most importantly, having now had the benefit of three weeks to review the ’604

patent claim charts for the Conquer 4G, Dart, and Exhibit II 4G, and to compare the contentions

therein with the ’604 patent infringement contentions as to Samsung’s other devices, Samsung does

not assert that the infringement theories with respect to the Conquer 4G, Dart and Exhibit II 4G are

any different from the infringement theories with respect to the 15 Samsung devices previously

accused of infringing the ’604 patent. In short, Samsung is unable to claim that the inadvertent

omissions caused it any prejudice.

With respect to Apple’s diligence, Samsung does not allege that Apple lacked diligence in

investigating its infringement claims with respect to the three omitted charts. Instead, Samsung

contends that Apple was not diligent in “identifying [the] missing claim charts.” (Opp’n at 7.) As

Apple conceded in its opening papers, Apple assumes responsibility for not identifying the errors at

an earlier time. But the fact remains that Apple only became aware of its error on October 2, 2012,

when Samsung’s counsel finally revealed that it never received these claim charts. Samsung should

not benefit from its deliberate silence on this issue, particularly when the corrections at issue would

cause absolutely no prejudice to Samsung.

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) 7

Indeed, other courts have clarified that defendants have a responsibility to ensure that they

fully understand the plaintiff’s allegations, and cannot wait to claim lack of notice of the scope of the

case or the infringement contentions. Orion IP, LLC v. Staples, Inc., et al., 407 F. Supp.2d 815, 818

(E.D. Tex. 2006) (explaining that defendants have a responsibility to make sure they fully understand

the nature of plaintiff’s allegations and cannot “lay behind the log until late in the case” and then

assert lack of notice).

Here, Apple promptly investigated its claims with respect to the Conquer 4G, Dart and

Exhibit II 4G, and Samsung does not dispute that by no later than June 15, 2012, Samsung was on

notice that Apple accused the Conquer 4G, Dart and Exhibit II 4G of infringing the asserted ’604

patent, and that Samsung waited to notify Apple of the missing charts.

3. Apple Was Diligent In Initially Investigating All Claims At Issue In

The ’502 Claim Charts And Apple’s Proposed Amendments Do Not

Expand The Scope Of Its Infringement Theories

With respect to Apple’s proposed amendment to add stylus-based claims to already-accused

Samsung devices, Samsung does not dispute that it was already on notice as to the stylus-based

infringement claims and that Apple’s amendments introduce no new infringement theory. Indeed, in

its original contentions Apple asserted claims 1-2, 4-5, and 13 of the ’502 patent against the Galaxy

Note, thereby putting Samsung on notice and eliminating the potential prejudice to Samsung.

Further, Apple was diligent in initially investigating and asserting these stylus-based claims in its

original Infringement Contentions.

As the Court is aware, the purpose of the disclosure obligations imposed by the patent local

rules is to “require parties to crystallize their theories of the case early in the litigation and to adhere

to those theories once they have been disclosed. Rule 16-9(c) advances this purpose by making it

difficult subsequently to revise claim charts through eleventh hour ‘discovery’ of facts.” Atmel Corp.

v. Info. Storage Devices, Inc., 1998 U.S. Dist. LEXIS 17564, at *7 (N.D. Cal. November 4, 1998)

(referencing Rule 16-9(c), Patent Local Rule 3-6’s predecessor rule). Here, because the amended

charts include the exact same infringement theory as originally disclosed, the amendments at issue

can hardly be characterized as being at odds with the purpose of the disclosure rules. And, given the

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) 8

overlap between the amended and original charts, Samsung cannot credibly assert that it would

somehow have modified its invalidity contentions – contentions that, in fact, cover the five claims in

the amended charts.

Samsung has not and cannot identify any prejudice suffered by these amended charts, and,

respectfully, the Court should overrule Samsung’s objections.

B. Even If This Court Concludes That Apple Did Not Act With Requisite Diligence

(Which It Should Not), That Does Not End The Good Cause Inquiry

As described above, Apple clearly acted with requisite diligence in seeking the amendments

at issue here. But even if this Court were to determine that Apple did not act with diligence with

respect to any particular set of amendments, that finding should not, as Samsung would have it, mean

that “the inquiry should end.” (Opp’n at 6.) Indeed, throughout its Opposition, Samsung cites Acer

Inc. v. Tech. Props., Ltd., 2010 WL 3618687 (N.D. Cal. 2010), for the proposition that unless the

moving party acts with the requisite diligence, the Court must deny a motion to amend. Samsung is

wrong. Courts in this District have held that good cause may be established even where the moving

party has not clearly demonstrated diligence in seeking leave to amend. Bd. of Trs. of the Leland

Stanford Junior Univ. v. Roche Molecular Sys., Inc., 2008 U.S. Dist. LEXIS 16556, at *8-9, *14

(N.D. Cal. Mar. 4, 2008) (granting leave to amend although movant “was arguably not diligent in

pursuing the amendment with this court”). Such a holding, moreover, is supported by the good cause

requirement, which prevents infringement contentions from becoming moving targets throughout the

lawsuit. CBS Interactive, Inc. v. Etilize, Inc., 257 F.R.D. 195, 201 (N.D. Cal. 2009). Accordingly,

amendment has been allowed where the “request to amend does not appear to be motivated by

gamesmanship” and “there is still ample time left in the discovery period.” Yodlee, Inc. v. CashEdge,

Inc., 2007 U.S. Dist. LEXIS 39564, at *5-6 (N.D. Cal. May 17, 2007). Discovery here does not end

until July 2013, and even Samsung does not contend that Apple has deliberately attempted to game

the system or that the amendments are part of an effort to make Apple’s Infringement Contentions

“moving targets throughout the lawsuit.” Clearly, good cause exists for Apple’s amendments.

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) 9

III. CONCLUSION

Apple thus respectfully requests that the Court grant its Motion for Leave to Amend its

Disclosure of Asserted Claims & Infringement Contentions to include (1) an operating system the

release of which was not completed until late-September 2012, (2) three claim charts out of 139 that

were inadvertently omitted from Apple’s prior service, and (3) the inclusion of five already-asserted

claims against Samsung’s remaining products.

Dated: October 26, 2012 GIBSON, DUNN & CRUTCHER LLP

By: /s/ H. Mark Lyon H. Mark Lyon

Attorney for Apple Inc.

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APPLE’S REPLY IN SUPPORT OF MOT. FOR LEAVE TO AMEND INFRINGEMENT CONTENTIONS 12-cv-00630-LHK (PSG) 10

CERTIFICATE OF SERVICE

The undersigned hereby certifies that the foregoing document was filed electronically in

compliance with Civil 5 Local Rule 5.4, and will be served on all counsel for Samsung Electronics

Co., Ltd., Samsung Electronics America, Inc., and Samsung Telecommunications America, LLC who

have consented to electronic service in accordance with Civil Local Rule 5.4 via the Court's ECF

system.

Dated: October 26, 2012

/s/ H. Mark Lyon H. Mark Lyon

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